TaxTMI 
TaxTMI 
2026 (2) TMI 636
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.... is observed that the ld. AO had called for the details of share capital issued by the assessee and after examining the details, the assessment was framed u/s 147/143(3) of the Act vide order dated 23.08.2011, assessing the total income at Rs. 28,500/-. Thereafter, the ld. PCIT, in exercise of the jurisdiction u/s 263 of the Act, revised the assessment dated 23.08.2011 on the ground that the ld. AO has not made any proper enquiries as regards to the source of share capital/ share premium and directed the ld. AO to frame the assessment afresh after affording a reasonable opportunity of hearing to the assessee. The ld. AO accordingly issued notice u/s 142(1) of the Act along with questionnaire and called upon the assessee to furnish all the details qua the share subscribers. The ld. AO thereafter also issued notices u/s 133(6) of the Act to all the share subscribers. Complying with the said notices, each of the share subscribers had submitted before the ld. AO all the information comprising names, addresses, PAN Numbers, copies audited balance sheets, profit and loss accounts, audited reports, bank accounts, etc. The ld. AO also issued summons u/s 131 of the Act to the directors of t....
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....facts showed otherwise. 5.1. Having perused the details furnished by the share subscribers, we observe that each of them held valid PAN and CIN and the proof of service of notices u/s 133(6), established the identity of the share subscribers. It is also observed that, the share subscribers were regular income-tax filers and their financials demonstrated sufficient strength to justify the amounts subscribed by them. The details of their net worth vis-à-vis the amounts paid by them is noted to be as under: Sl No. Name of the Shareholder Amount Networth 1 AbhilashiniCommosales Pvt. Ltd. 4,50,000 10,49,00,000 2 Banke bihariVyapaar Pvt. Ltd. 35,00,000 2,91,00,000 3 Bright Tracom Pvt. Ltd. 40,00,000 4,11,50,000 4 Decent Professional services Pvt. Ltd. 20,00,000 2,49,07,744 5 Deora Finance Pvt. Ltd 57,00,000 29,80,01,588 6 Jai Mata Texo Traders Pvt. Ltd 35,00,000 7,18,14,900 7 Lahoti Agro Pvt. Ltd 40,00,000 2,01,57,000 8 Lambodar Commotrade Pvt. Ltd 25,00,000 7,15,00,000 9 Lifeline Properties Pvt. Ltd 10,00,000 4,12,50,000 10 Lingard Mercantile Pvt. Ltd ....
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....ed the same contemporaneously to the statutory authority, namely, Ministry of Corporate Affairs. 19. Before the Assessing Officer, the assessee produced all such relevant materials with regard to the transaction in question. The absence/non-appearance of the Directors of the assessee before the Assessing Officer would not prompt the Assessing Officer, to render a finding that no explanation within the meaning of Section 68 of the Act of 1961 was offered by the assessee particularly in the factual matrix of the present case. 20. In such circumstances, we do not find any substantial question of law involved for the purpose of consideration by this Court as contended on behalf of the appellant." 5.4. We also rely on the decision of the Hon'ble jurisdictional High Court in the case of PCIT vs. Balaka Vinimay Pvt Ltd (GA No. 2 of 2025) dated 21.07.2025. In this case also, the assessee and the share subscribers had furnished all the relevant details in support of the share application monies before the AO. The AO however disbelieved the explanation since there was non-compliance of summons u/s 131 by the directors of the share subscribers. Taking note of the practica....
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....ders had been passed, proceedings was initiated. Thus, the predicament faced by the assessee was taken note by the learned Tribunal and it had observed that it is practically difficult that after a gap of 10 to 12 years, the assessee can call for the share subscribers who invested long time before and there is every possibility that the shareholders would have sold their equities and new shareholders would have taken their place. The learned Tribunal referred to the decision of the co-ordinate Bench in the case of True- Man Consultants Pvt. Ltd. vs. ITO in ITA No.1158/Kol/2023, wherein almost identical issue of unexplained share capital from various share subscribers came up for adjudication and after considering the factual aspect and following the judicial pronouncements, the appeal filed by the assessee was allowed by the Tribunal. The revenue preferred an appeal before this Court in ITAT/203/2024 and by order dated 25th April, 2025, the appeal filed by the revenue was dismissed. Thus, we find that the factual issues have been thoroughly adjudicated by the Tribunal apart from noting that the assessee had been put to multiple levels of scrutiny and the assessee ....